Specialty Pharma Company

Amarillo Biosciences, Inc. (OTCBB: AMAR) is the world leader in the development of low-dose interferon for oral delivery and has progressed to Phase 2 clinical studies using its unique, patented interferon lozenges to treat human diseases.

Low-dose oral interferon has been shown to prevent death in mice infected with H1N1 or H5N1 influenza viruses.  The University of Western Australia completed a Phase 2 clinical trial with 200 healthy volunteers during the 2009 winter cold/flu season in Australia. The study found that volunteers who took oral interferon had a shift from moderate to mild in the severity of cold/flu symptoms, compared to volunteers who received placebo. Significantly fewer volunteers in the interferon group who had been vaccinated against seasonal influenza had an episode of influenza-like illness during the study, compared to vaccinated volunteers in the placebo group. Additionally, volunteers over the age of 50 (high risk for influenza) experienced fewer episodes of influenza-like illness if they took interferon during the study, compared to those who received placebo. Laboratory results regarding viral infection rates during treatment are expected in the second quarter of 2010.

CytoPharm, Inc., AMAR’s licensee for Taiwan and China, is funding an ongoing Phase 2 study of oral interferon treatment of hepatitis C virus-infected patients in Taiwan.  The study is expected to demonstrate the ability of oral interferon to reduce virologic relapse in patients who have completed standard therapy with pegylated interferon plus ribavirin.  Up to 50% of patients with certain genotypes of HCV relapse after receiving standard therapy. Reducing this relapse rate will represent a major breakthrough in the management of HCV. Preliminary results are expected by the end of 2010.

Technology:  Non-toxic Interferon

Interferon is an immune modulator approved to treat some cancers, as well as viral and autoimmune diseases. AMAR has completed pre-clinical (animal trials) and human safety studies for its low-dose oral interferon product. The oral route of administration in humans uses a lozenge that is stable for up to 2 years at room temperature.  Orally delivered interferon binds to mucosal cells in the mouth and throat, resulting in stimulation of the immune system through activation of hundreds of genes in the peripheral blood.  Oral interferon is given in doses 10,000 times lower than injectable interferon, so side effects are virtually eliminated.  AMAR has nine issued and four pending patents.

Market Potential:  $Billions

Treating influenza in the USA and big 5 countries in Europe represents a potential multi-billion dollar market. Influenza infects 10% of the world’s population and kills one million per year.

Management

Joseph Cummins, DVM, PhD, founder and CEO, is a world expert in oral interferon and has 55 publications and 21 issued and pending patents. Dennis Moore, DVM, is retired from private veterinary practice. James Page, MD, Director, retired as Vice President with Adria Laboratories.  Thomas D’Alonzo, JD, Director has been President of Pharmaceutical Product Development, Genevec and the US unit of what is now Glaxo SmithKline.  Stephen Chen, PhD, Director was formerly Director of Pharmaceutical R&D at Ciba-Geigy.  Martin Cummins, VP of Clinical & Regulatory Affairs has 18 years experience in clinical trial management and regulatory affairs.  Bernard Cohen, MPA, CFO, has 30 years of accounting and management experience.

Development Partners in 28 Countries

AMAR has development partners in 28 countries: Turkey and 16 countries in Central Asia (Nobel); China and Taiwan (CytoPharm); Indonesia, Philippines, Cambodia, Thailand and Vietnam (Cyto Biotech); Japan (Hayashibara Laboratories); Malaysia (Bumimedic); and India and Nepal (Intas). 

Capital Structure

As of March 10, 2010, 53,225,065 common shares of stock are issued and outstanding with 25,287,096 shares reserved for stock grants, options, and warrants.  No shares of convertible preferred stock are issued. The shareholders have authorized 100,000,000 shares of common stock and 10,000,000 shares of preferred stock.

Disclosure

This is neither an offering nor a solicitation of an investment in Amarillo Biosciences. Such an offering can only be made by means of the confidential private placement.  Except for the historical information contained herein, the matters discussed are forward-looking statements that involve risks and uncertainties, including uncertainties related to product development, uncertainties related to the need for regulatory and other government approvals, dependence on proprietary technology, uncertainty of market acceptance of oral interferon and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission.  In particular, see “Item 1. Description of Business” and “Item 7A. Qualitative and Quantitative Disclosures About Market Risk” of the company’s form 10-K for the year ended December 31, 2009.